Sidi Moktar Licence

PetroMaroc is the operator of the Sidi Moktar licences, with 100 percent gross interest and a 50 percent after-earned net interest. Partners are Maghreb Petroleum Exploration (MPE), 25 percent carried working interest, and ONHYM, 25 percent carried working interest. These three blocks, totalling 4,499 square kilometres, are located in the Essaouira Basin in central Morocco, an area that has been producing gas since the 1950′s. The blocks surround the Meskala field, which is one of Morocco’s major producing fields.

Four fields within Sidi Moktar have successfully produced 30.5 billion cubic feet of gas from Jurassic-aged reservoirs. Principal objectives are the Silurian sourced Triassic targets, proven by the neighbouring producing Meskala field. Resource estimates for Triassic targets are 427 billion cubic feet (Bcf) (Best Estimate) and 830 Bcf (High Estimate) of potentially recoverable gas and 26 million barrels (MMBbl) (Best Estimate) and 50 MMBbl (High Estimate) of potentially recoverable condensate.

PetroMaroc’s drilling campaign in the Sidi Moktar exploration licence has discovered a significant natural gas opportunity in the lower Liassic formation of the Kechoula structure. The Lower Liassic formation has the geological characteristics of a “hybrid” (conventional and unconventional) natural gas reservoir.

Sidi Moktar Basic Data

Licence Exploration Licence, Onshore
Area 2,683 km2 (662,969 acres)
Exploration To Date 6,172 km of 2-D seismic, 40 exploration & development wells
30.5 Bcf produced from 4 fields
Work Programme Completed By PetroMaroc 
  • Drilled two exploration wells that discovered a significant gas resource
  • Basin wide interpretation of 4,500 km seismic
  • Reprocessing of 1,500 km 2-D seismic
  • New acquisition of 520 km 2-D seismic
  • Petrophysical analysis of key offset wells
  • Geological evaluation studies and in-field sedimentology studies
Prospective Reservoirs Lower Liassic and Triassic clastics
Reservoir Depth 1,800-2,400 metres
Hydrocarbon Source Rocks Silurian shales
Trap Style Four way dip closed structures and stratigraphic traps
Petromaroc Interest 50% Operator
MPE (25%), ONHYM (25%)

Substantial Natural Gas Resource

PetroMaroc’s drilling campaign on the Kechoula structure has discovered a significant natural gas opportunity in the Lower Liassic formation.

On March 20, 2014, PetroMaroc commenced drilling the Kamar-1 well, targeting Lower Liassic and Triassic clastic reservoirs. The Kamar-1 well was drilled to a final total depth of 2,790 metres and intersected two distinct gas-bearing intervals. One was in the targeted Lower Liassic natural gas zone and had a gross interval of 110 metres as defined by petrophysical, wireline logs. The other was defined by the presence of significant natural gas volumes in the drilling mud within the Lower Dogger/Upper Liassic zone, which occurs over a gross interval of approximately 100 metres.

On November 18, 2013, PetroMaroc commenced drilling of the Koba-1 well, targeting Lower Liassic and Upper Triassic clastic reservoirs. The Koba-1 well was drilled to a total depth of 3,100 metres and operations were completed in early January 2014. The well encountered a gross interval of approximately 45 metres with reservoir potential. Over this section, gas shows of over 10% were encountered throughout the interval, along with heavier hydrocarbon components.

The data from these wells is currently being processed, reviewed, analysed and integrated for the purpose of designing an extensive formation testing program over the encountered gas-bearing intervals. Contingent on the results of this testing program, a follow-up 3-D seismic program is planned to better identify potential appraisal drilling locations.

Advancing Development

Forward operations plans for the Kechoula structure include evaluating existing wells and data using the most cost-effective technologies to determine the highest potential value. This may include the use of advanced completion techniques. Elements of the testing program include procuring a rig and equipment to complete prospective zones, and conducting drill-stem or production tests to determine flow, volume, pressure, recovery and rock properties. The test results are expected to provide an indication of the potential reserves and deliverability, which will be verified by an independent qualified reserves evaluator.

PetroMaroc will also acquire 3-D seismic over the structure prior to drilling two to three additional delineation and appraisal wells.

Resource Estimates

GLJ Petroleum Consultants (“GLJ”), a premier oil and gas resource consulting firm headquartered in Calgary, has completed an independent evaluation of the Undiscovered Petroleum Initially in Place (“UPIIP”) and prospective resources of the Kechoula structure located in the Sidi Moktar Exploration Licence, Morocco, incorporating the technical information obtained from the Koba-1 and Kamar-1 wells, which were drilled in 2013 and 2014.

Table 1 - Summary of Undiscovered Petroleum in Place (UPIIP) Prospective Resources for the Lower Liassic

Prospect

Gross Lease Unrisked UPIIP (BCF)

Pg

Gross Lease Partially Risked UPIIP (BCF)

Low Est

Best Est

Mean

High Est

Low Est

Best Est

Mean

High Est

Liassic

85.4

293.4

393.7

835.4

0.81

69.2

237.7

318.9

676.7

 

Table 2 - Summary of Geological Risks (Pg) Lower Liassic

Source

Maturity

Migration

Reservoir

Trap

Timing

Seal

Pg

1.00

1.00

1.00

0.90

1.00

1.00

0.90

0.81

 

Table 3 - Prospective Resources for the Lower Liassic

Prospect

Gross Lease Unrisked Prospective Gas Resources (BCF-Sales)

Gross Lease Partially Risked Prospective Gas Resources (BCF-Sales)

Low Est

Best Est

Mean

High Est

Low Est

Best Est

Mean

High Est

Liassic

44.90

156.0

215.5

462.3

36.40

126.4

174.6

374.4

 

Prospect

Gross Lease Unrisked Prospective NGL Resources (MMSTB)

Gross Lease Partially Risked Prospective NGL Resources (MMSTB)

Low Est

Best Est

Mean

High Est

Low Est

Best Est

Mean

High Est

Liassic

1.39

5.7

8.2

17.94

1.13

4.62

6.65

14.53

 

Prospect

Gross Lease Unrisked Prospective Resources (MMBOE)

Gross Lease Partially Risked Prospective Resources (MMBOE)

Low Est

Best Est

Mean

High Est

Low Est

Best Est

Mean

High Est

Liassic

8.9

31.7

44.1

95.0

7.2

25.7

35.7

76.9

 

The GLJ UPIIP assessments were prepared in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and National Instrument 51-101 “Standards of Disclosure for Oil and Gas Activities” (“NI 51-101″).

UPIIP (equivalent to undiscovered resources) is that quantity of petroleum that is estimated, on a given date, to be contained in accumulations yet to be discovered. The recoverable portion of undiscovered petroleum initially in place is referred to as “prospective resources,” the remainder as “unrecoverable.” Undiscovered resources carry discovery risk. There is no certainty that any portion of the UPIIP disclosed in this report will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the UPIIP disclosed in this report. A recovery project cannot be defined for this volume of UPIIP at this time. The UPIIP estimates contained herein have been risked for the chance of discovery but have not been risked for the chance of development and hence are considered partially risked estimates.

Low Estimate is considered to be a conservative estimate of the quantity of Gas Initially In Place. It is likely that the actual Gas Initially In Place will exceed the low estimate. If probabilistic methods are used, there should be at least a 90 percent probability (P90) that the actual Gas Initially In Place will equal or exceed the low estimate.

Best Estimate is considered to be the best estimate of the quantity of Gas Initially In Place. It is equally likely that the actual Gas Initially In Place will be greater or less than the best estimate. If probabilistic methods are used, there should be at least a 50 percent probability (P50) that the actual Gas Initially In Place will equal or exceed the best estimate.

High Estimate is considered to be an optimistic estimate of the quantity of Gas Initially In Place. It is unlikely that the actual Gas Initially In Place will exceed the high estimate. If probabilistic methods are used, there should be at least a 10 percent probability (P10) that the actual Gas In Place will equal or exceed the high estimate.

Mean estimate is the arithmetic average from the probabilistic assessment.

There are numerous uncertainties inherent in estimating quantities of UPIIP, including many factors beyond the Company’s control.  The UPIIP information set forth herein represents an estimate only.  Due to the uncertainty as to how the play will be developed and the lack of definition of a recovery project for the UPIIP at this time, the UPIIP estimates disclosed herein are the most specific assignable category that can be provided at this time.